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Asian Stocks Rebound as AI and Chip Shares Recover; Easing Iran Tensions Boost Sentiment

Asian Stocks Rebound as AI and Chip Shares Recover; Easing Iran Tensions Boost Sentiment. Source: Image by Gerd Altmann from Pixabay

Asian stock markets moved higher on Tuesday, supported by a strong rebound in semiconductor and artificial intelligence-related shares after heavy losses in previous sessions. Investor sentiment also improved as geopolitical tensions in the Middle East showed signs of easing following reports that Israel and Iran agreed to halt military strikes after pressure from U.S. President Donald Trump.

South Korea’s KOSPI index emerged as the top performer in Asia, climbing 3% after suffering a sharp decline in the previous session. The recovery was driven by gains in major chipmakers, with Samsung Electronics rising 3.4% and SK Hynix surging 7.7%. SK Hynix also benefited from news of a significant partnership with AI chip leader Nvidia. Additional support came from revised economic data showing South Korea’s GDP expanded by 1.8% in the first quarter, fueled largely by strong semiconductor exports.

Japan’s Nikkei 225 gained 0.9%, recovering from steep losses earlier in the week, while the broader TOPIX index added 0.5%. Technology stocks led the advance, with Tokyo Electron jumping 7.6%. However, investors remain cautious about the sustainability of the AI-driven market rally amid concerns over elevated interest rates and ongoing geopolitical risks.

Chinese equities also advanced after stronger-than-expected May trade data highlighted the resilience of the country’s export-driven economy. The Shanghai Composite and CSI 300 indexes each rose 0.4% as exports and imports exceeded forecasts, reflecting robust demand for semiconductors and AI-related infrastructure. Markets largely shrugged off the U.S. decision to place several Chinese technology giants, including Alibaba, Baidu, and BYD, on a blacklist linked to military concerns.

Elsewhere in the region, Singapore’s Straits Times Index gained 1.1%, while Hong Kong’s Hang Seng Index slipped 0.2%. Australia’s ASX 200 underperformed, falling 0.3% due to weakness in mining stocks. India’s Nifty 50 futures pointed to a subdued opening as investors continued to monitor the impact of higher oil prices on the country’s import-dependent economy.

The broader Asian market outlook remains tied to developments in artificial intelligence, semiconductor demand, global interest rates, and Middle East geopolitical stability, all of which continue to influence investor confidence across regional financial markets.

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